Theresa May and the Politics of Uncertainty

12thFebruary2018

Ali Gordon, Member of the Young Consultants Committee

Time is running out for Theresa May to secure a cabinet consensus and outline exactly what the UK wants Brexit to look like. Following seven days of infighting, ‘war rooms’, dismal economic forecasts, and growing impatience on all sides, the Prime Minister continues to stagger on.

Against the backdrop of reignited feuding between factions inside and outside the Cabinet, the PM hosted meetings of the Brexit “war cabinet” on Wednesday and Thursday last week. It was seen by some as an crucial moment to settle old scores and come to a compromise over the politics of the Brexit transition period, as well as to decide upon the conceptual framework for Britain’s future relationship with the EU.

Senior ministers have attempted to portray the discussions as "very constructive" and that significant progress is being made. However, the Government's position on what it wants in terms of a future relationship is still no clearer, and there is evidence of growing impatience on all sides.

The EU has hardened its stance through the publication of its position paper on the transitional arrangement which many, including Brexit Secretary David Davis, have interpreted as a threat to the UK not to deviate during the transition from the jurisdiction of the ECJ. Furthermore, Jacob Rees-Mogg’s impromptu but perhaps purposefully orchestrated appearance outside Number 10 Downing Street shortly after Thursday’s meeting could be viewed as a reminder that Brexiteers will not tolerate attempts to pursue a BINO (Brexit in Name Only) strategy.

Impatience is also growing concern among the business community that political ideology appears to be trumping economic pragmatism. The recently published Brexit impact assessments reveal the negative impact that different trade deal scenarios could have on various sectors of the economy. A number of sectors at the mercy of cross-border supply chains will have interpreted the forecasts with huge concern. This included:

between 5% to 13% cost increases for the motor industry

between 7% to 20% cost increases for the retail and wholesale industries

between 5% to 10% cost increases for the financial services sector

There were also alarming revelations around the geographical variation of the impact of a ‘no deal’ scenario. The forecasts revealed that majority Leave-voting North East of England and West Midlands will sustain the biggest hits to their economic growth, whilst Remain London will suffer the least damage.

As a Valentine’s Day gift next week, Boris Johnson is due to make a speech designed to repair an increasingly strained and unhappy marriage between Remain and Leave factions in the Tory party. Some have suggested that his intervention could turn into a “Valentine’s day massacre” acting as yet another veiled challenge to Theresa May’s fragile leadership.

Time is running out: Parliamentarians, EU officials and businesses are growing impatient and expect clarity. The coming weeks could well define Theresa May’s tenure as Prime Minister, determining whether her efforts to navigate a successful outcome for Britain can be achieved.